While cold email can be a powerful tool for a new brand starting from zero, it’s important to remember that there are risks associated with its use. Those risks often outweigh the rewards, but brands are finding this out too late. Let’s take some time and explore the dark sides of cold email. This way, if you choose to dive in, you dive in fully informed.
What is a “Cold Email” anyway?
Cold email is a form of marketing outreach which involves sending emails to prospective contacts with the goal of creating meaningful relationships. It is distinct from regular email campaigns, in that it typically targets new contacts that have not already expressed an interest in the brand or product. Cold emails are often personalized, and are designed to be more engaging than traditional email marketing.
Sales automation companies have a vested interest in ensuring that cold email is not confused with spamming. You will find a lot of content on the internet about the virtues of cold email, but if you look closely, you’ll find most of the content and supporting statistics are from vendors in the space such as Woodpecker.io, Outreach.io and Salesloft.
Is all cold email evil? No. It’s true that small-scale, highly personalized one-off cold email efforts on the part of sales, especially when paired with phone and social outreach, are part of a well-balanced prospecting diet. Done well, these pass the sniff test for spam because they are tightly targeted, highly personalized, from a reputable sender and come from a place of wanting to help.
But the truth is that any unwanted, unsolicited email sent at scale is spam (by definition – look it up). Even the most clever, well-researched cold email will be unwanted more often than it’s welcomed. Throw automation and limited personalization at this picture, and you rapidly slide into the gradient toward cheap offshore software development, loans you didn’t apply for, or a large inheritance someone needs your help to process.
Cold Email’s Impact on Deliverability
Before we can get into deliverability, we need to outline a few brief vocabulary words.
Domain reputation is how mail service providers (MSPs) such as Gmail and Outlook/Office 365 view your domain as an email sender. This includes whether or not they trust your emails enough to deliver them directly into the inboxes of recipients instead of filtering them out as spam. The way MSPs measure your domain reputation is using a secretive metric called sender rating.
Your sender rating is a score assigned by MSPs based on how well you are following best practices for email sending. This rating isn’t public, nor do MSPs share much about how it’s calculated, but we know it takes into account factors such as engagement rates, open rates, bounce rates, unsubscribe requests, and complaint/spam reports. The higher your score, the better chance you have of having your emails delivered directly into the inboxes of potential (and existing) customers instead of being filtered out as spam.
There’s a little more to it, but you get the gist (If you want to learn more, we have a great on-demand webinar on the topic of email deliverability).
Cold email, by virtue of being cold, generally fails all the tests for best practices and is all but guaranteed to reduce your sender rating. Engagement rates are low, open rates are low, bounce rates can be high (depending on where you get your list), you get lots of unsubscribe requests, and it often triggers spam complaints.
It’s fair to note that a small volume of highly personalized cold emails can be offset by a large volume of legitimate email, so if you have a really well-tuned email marketing program, using good database hygiene, or your cold email program pales in comparison to the email the rest of your organization sends, then you could be in the clear.
But most cold email programs just don’t stay small. Those small-scale, highly personalized one-off cold email efforts create good results, but they are an awful lot of work. So sales and marketing teams turn to automation tools to improve efficiency, turning personalized, bespoke sales emails into large scale, automated spam complaint generators. Unfortunately, this can tip the scales by creating an unhealthy ratio of unsolicited email to legitimate business email.
Finally, some organizations work to sidestep this issue by using an alternate domain name for their cold email campaigns. For example, if the corporate email addresses end in @widget.co, the brand would send cold email from addresses ending in @getwidget.co. This can protect your main email domain from deliverability issues due to a poor sender rating, but it will be very hard to get a good sender rating on the alternate domain. I should add, this does nothing to solve the brand reputation problem with cold email. For that, read on…
Cold Email’s Impact on Your Brand
When someone receives an unwanted email from your business, they are going to react. Unless, by a stroke of luck, you caught just the right person with the very solution to their problem this week, that reaction could range from annoyance to outright anger. It all depends on your prospect’s level of sensitivity towards spamming.
That negative brand effect extends well beyond the cold email campaig to any additional marketing activities you undertake in the future. For example, if you come up in paid or organic search results or appear in a prospect’s social feed, that prospect who had previously received cold emails from you may view these new encounters with suspicion and skepticism due to their prior negative experiences with your brand.
Unfortunately, this perception of your brand as a “spammer” can have long-term consequences for all your other marketing efforts—even if you pull back or stop your cold email program. And pulling back is almost inevitable, since as we’ll discuss next, cold email is generally a short-term play.
Cold Email’s Rapidly Diminishing Returns
There is no doubt that brands that launch cold email programs see nearly immediate returns – returns that point toward a new high-performing channel for new business.
But much like a mining operation that pulls out all the easy-to-reach ore, a large-scale cold email program will capture easy-to-reach prospects first, with diminishing returns to follow.
There are only so many perfect prospects out there to hit up via cold email. As soon as you have to retread over list members you’ve hit before, you’ll get next to no response.
This part isn’t often written about cold email, but we see it often, especially with brands who have a limited total addressable market, or TAM. If you are geographically constrained or service only a certain industry or market, you’ll find that after you prioritize your top targets, there just isn’t that much gold in them thar hills.
So When Does Cold Email Make Sense?
Sometimes, you just have to get scrappy. If you are just starting out, and you don’t have any brand recognition, no marketing engine, and nothing amplifying your sales efforts, cold email can be a necessary tool to get pipeline flowing.
But if you do choose to go down this path, it’s important to keep the points in this post top of mind:
- Use an alternative domain after you’ve warmed it up to make sure you don’t accidentally kill your business emails.
- Do everything you can to minimize bounces, maximize engagements and replies, and limit unsubscribes. This means picking a highly targeted list, checking it with a tool like NeverBounce, and A/B testing your copy with highly personalized lead-ins.
- Protect your brand by asking others to review your emails, removing anything that smells remotely of spam.
- Know this is a short-term tactic and once you’ve burned through your best lists, it’s time to move on to more sophisticated sales and marketing strategies.
Cold emailing is a risky strategy that can have negative consequences for your brand. Unless you are starting from scratch and don’t have any marketing channels in place, there are other tactics you can explore that are more likely to result in sustainable, long-term growth.